OR · Payroll tax 2026
The true cost of hiring in Oregon
Estimate what a W-2 employee costs in Oregon and compare it with a 1099 contract using sourced 2026 payroll-tax defaults that you can adjust to your assigned rate.
Estimate a Oregon hire
Pre-filled with a 2.4% base new-employer rate. Adjust SUI, salary, benefits, and the 1099 rate to fit your hire.
Results update instantly. Your values stay in this browser.
A W-2 hire in Oregon costs more than salary. Employers pay federal FICA and FUTA plus state unemployment insurance. For 2026, HiringMath uses a 2.4% base new-employer rate on the first $56,700 of wages, producing up to about $1,361 of state UI tax per worker before experience-rating or account-specific adjustments. Oregon taxes wage income, which creates a withholding obligation but is not an employer-paid tax. Paid Leave Oregon employer share 0.4% (25+); statewide transit tax 0.1%. The calculator below combines those statutory items with editable benefits, workers' compensation, and overhead, then compares the result with a 1099 contract.
Oregon employer tax facts
| Item | OR |
|---|---|
| Base new-employer SUI rate | 2.4% |
| SUI taxable wage base | $56,700 |
| Federal FICA (employer) | 7.65% |
| FUTA | 0.6% |
| State income tax on wages | Yes |
| Worker classification test | ABC test |
Extra employer taxes: Paid Leave Oregon employer share 0.4% (25+); statewide transit tax 0.1%.
- Paid Leave Oregon — Employer share 0.4% (employers with 25+ employees).
- Statewide transit tax — 0.1% on total wages.
Example: a $75,000 hire in Oregon
At a $75,000 base salary with typical benefits, a W-2 employee in Oregon costs an employer $100,815 per year — $25,815 above base pay. An equivalent 1099 contract at $75,000 would cost $25,815 less; the breakeven contract rate is $100,815.
Misclassification risk in Oregon
Test: ABC test
ABC test; back UI taxes; BOLI civil penalties.
Penalties by stateCompare nearby rates
Oregon's 2.4% new-employer SUI rate sits near Hawaii (2.4%), Massachusetts (2.42%), Missouri (2.38%), Wyoming (2.35%). See the full 51-state comparison or the 2026 employer payroll tax reference.
Common questions
Oregon hiring-cost FAQ
What SUI rate does HiringMath use for Oregon?
The calculator starts with a 2.4% base new-employer rate, applied to the first $56,700 of each employee's 2026 wages. Your assigned rate can differ because of industry, surcharges, and claims history, so replace the default with the rate on your state notice when available.
Does Oregon have a state income tax?
Yes. Oregon taxes wage income. Employers withhold it from employee pay, but it does not directly increase the employer's payroll-tax cost.
What should employers know about worker classification in Oregon?
ABC test; back UI taxes; BOLI civil penalties. This is a planning summary, not legal advice; confirm classification decisions with the relevant agency or counsel.